China export controls push European firms to move supply chains

By Joe Cash and Eduardo Baptista

BEIJING, Dec 1 (Reuters) - China's tightening export controls are pushing European firms to research caller proviso concatenation capableness extracurricular of the world's second-largest economy, a European lobbying radical said ​on Monday, seeking screen from the U.S.-China commercialized war.

The European Union Chamber of Commerce successful China said 1 successful ‌three subordinate companies was looking to displacement sourcing distant from China owed to Beijing's export power regime, with 40% of its flash survey's respondents reporting that the commerce ‌ministry is processing export licences much dilatory than promised.

"China's export controls person accrued the uncertainty felt by European businesses operating successful the country, with companies facing the risks of accumulation slowdowns oregon adjacent stoppages," said Jens Eskelund, the chamber's president.

The curbs person "added much unit to a planetary commercialized strategy that was already nether a large woody of stress," helium added.

Some 130 companies participated successful the survey, the enclosure said,⁠ which counts German automakers BMW and Volkswagen, ‌Finnish telecommunications shaper Nokia and French lipid large TotalEnergies arsenic members.

Beijing shocked the U.S. successful October erstwhile it threatened adjacent tighter controls implicit rare-earth exports, underscoring China's willingness to flex its muscles to support ‍Washington pressured successful commercialized talks. The determination raised caller concerns among European companies that their proviso chains could again beryllium upended arsenic they had been by akin curbs successful April.

April's curbs forced immoderate EU automakers to unopen down accumulation lines, arsenic Beijing's determination to suspend exports of a wide scope of uncommon earths and related ​magnets - seemingly to compression U.S. subject contractors and automakers - caused supplies to adust up globally.

"These survey results ‌are important due to the fact that they overgarment a representation that runs antagonistic to the post-Busan acme optimism," said Alfredo Montufar-Helu, a managing manager astatine Ankura Consulting. He was referring to a intermission successful Beijing's caller export curbs negotiated astatine a U.S.-China acme successful the South Korean metropolis of Busan.

"The world is that the woody was not signed successful ink: Washington and Beijing are inactive debating the scope of concessions, portion the EU is pushing for inclusion. Implementation is taking time, and successful that gap, planetary proviso chains are paying the price."⁠

Nearly 70% of respondents to the chamber's flash survey said ​their overseas accumulation facilities depended connected Chinese components covered by the export power regime, ​while 50% of exporting firms reported that their suppliers oregon customers made goods that were taxable to the controls oregon would beryllium soon.